Nomura has downgraded Bank of Baroda to “neutral” from its earlier rating of “buy” and has cut its price target to ₹235 from ₹265 earlier. The revised price target implies a potential upside of 5% from Wednesday’s closing price.
The brokerage said that Bank of Baroda reported a weak quarter and the outlook on its Net Interest Margins (NIMs) is also soft going forward.
Bank of Baroda anticipates its margins in financial year 2026 to remain consistent with the levels reported in financial year 2025.
Margins for the lender are likely to continue to remain under pressure due more rate cuts anticipated from the Reserve Bank of India (RBI). The RBI has already cut rates by 50 basis points so far.
Therefore, Nomura has cut its margin outlook for Bank of Baroda for financial year 2026 and 2027 by 18 basis points and 14 basis points respectively.
The brokerage has also trimmed its Earnings per Share (EPS) outlook for the same timeframe by 8% and 10% respectively, largely to factor in a lower Net Interest Income (NII).
Bank of Baroda reported March quarter results on Tuesday and the stock fell over 10% after the lender saw elevated slippages and write-offs compared to the December quarter. Its Net Interest Income fell from last year.
Out of the 37 analysts that have coverage on the stock, 28 of them have a “buy” rating, seven say “hold”, while two have a “sell” recommendation.
Shares of Bank of Baroda ended little changed on Wednesday at ₹224.75. The stock reversed all the gains made in 2025 after Tuesday’s drop and is now down 7% for the year.
